This paper represents a first attempt to model the macroeconomic implications of recent changes in Australian financial markets: the floating of the Australian dollar; the introduction of tendering for government bonds; and the deregulation of banking in August 1984. The RBII model is adapted to...

The econometric technique of cointegration is used to model the aggregate demand for imports in Australia over the period from September 1974 to September 1989. We find that movements in total and endogenous imports are well explained by movements in domestic demand, the relative price of...

No abstract available

Using unpublished data at a disaggregated level, this paper provides a detailed picture of the direction of investment over the 1985/86 to 1988/89 investment boom. Most of the growth in non-farm capital expenditure has been concentrated in a few industries, in particular, office construction. We...

The proposed market-risk capital-adequacy framework, to be implemented at the end of 1997, requires Australian banks to hold capital against market risk. A fundamental component of this framework is the opportunity for banks to use their value-at-risk (VaR) models as the basis of the market-risk...

This paper examines how firms adjust output and prices in response to changes in demand and costs, paying particular attention to the role that capacity utilisation plays in affecting these relationships. It primarily uses qualitative survey data on manufacturing firms’ actual and expected...

Over the past decade or so, aggregate data suggest a trend increase in housing equity withdrawal in Australia, potentially stimulating household spending. However, there has been little disaggregated information on how equity is being withdrawn and injected, the characteristics of households...

No abstract available

Inflation expectations have wide-reaching effects on the macroeconomy and are an important part of the transmission of monetary policy. This paper analyses the Melbourne Institute survey of householders’ inflation expectations. Householders’ average inflation expectations vary with personal...

The hypothesis that deviations from PPP follow a random process is tested against two alternatives that the real exchange rate reverts to a constant equilibrium level (long-run PPP); and that it reverts to an equilibrium level which is itself a function of shifts in commodity prices (long-run...